Startup Trends: 2023’s top funded startups

In the past year, billions of dollars of venture capital poured into two cutting-edge generative AI companies, OpenAI and Anthrophic.

What might come as more of a surprise is that two battery recycling startups were among the leading recipients of venture-capital funding in 2023.

In August, Redwood Materials, the battery recycler founded by former Tesla co-founder JB Straubel, raised over $1 billion in a Series D round. The company says it will use the funds to increase its ability to recycle batteries in the United States. And in September, Ascend Elements announced that it raised $542 million in a Series D funding round. The company, which recycles lithium batteries, plans to use some of that funding for a manufacturing facility in Kentucky, where it aims to recycle the metals in old batteries into sustainable, battery-ready materials.

Among the other companies that have scored big funding hauls this year are Databricks, which raised an additional $550 million in September and CoreWeave, a specialized cloud provider which generated a total of $421 million in two separate funding rounds in early 2023.

The list of companies that attracted the greatest venture funding this year is quite different from the leaders of 2022. Last year’s list included Anduril, the defense technology firm; Altos Labs, a biopharma company; The Boring Company, a tunnel-construction firm founded by Elon Musk; Resilience, a biopharma manufacturing company, and Eikon Therapuetics, a biotech firm

And lest we forget OpenAI and Anthropic, the two competing companies that have come to symbolize the surging generative AI industry and whose fundraising efforts dwarfed other leading startups.

In April, OpenAI, the creator of ChatGPT, garnered $300 million in funding from venture capitalists including Sequoia Capital, Andreessen Horowitz, Thrive and K2 Global. But that funding was surpassed by the roughly $10 billion in January that Microsoft reportedly invested in exchange for a sizable minority stake in the company.

While Microsoft has played an outsize role in financially supporting OpenAI this year, Alphabet’s Google has played a similar role for competitor Anthropic, which developed Claude, a chatbot rival to ChatGPT. Earlier in 2023, Google invested $300 million in Anthropic, taking a 10% stake in the AI company. Then a few months later, Anthropic raised an additional $450 million from several investors including Google, Salesforce and Sparks Capital.

Finally, in October, Google announced it was investing an additional $2 billion in Anthropic through a $500 million upfront cash infusion and an additional $1.5 billion to be invested over time, an Anthropic spokesperson told CNBC.

About the Author

John Kimelman is a veteran journalist who has worked at Barron’s and CNBC covering such topics as investing and commercial banking. Mr. Kimelman has received compensation from Forge Global, Inc. for authoring this article. Read more from John.

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